Transcript from Jonny Gordon-Farleigh’s opening speech at Stir to Action’s Democratic Business Summit in Manchester on November 1 2023.
Firstly, thank you so much for joining us today for the first ever Democratic Business summit – it’s my hope that today’s summit becomes a platform where we can continue to consolidate our thinking, efforts, and relationships, and work to strengthen the role this business movement has in the transition towards a more equitable and secure future.
So, now why are we here? Well first, the negative analysis. We have a crisis of democracy across all of our shared institutions – the political system, civil society, and of course, within the business economy. We are also experiencing historic and unprecedented levels of concentrated private ownership across business, public infrastructure, and local communities.
If we look at business, we’ve seen enforced precarity across the private sector – the introduction of zero-hour contracts, below-inflation pay rises, and new levels of work-related stress – all following on from decades of wage stagnation. If we look at public infrastructure, from the roads we drive on; the farmland that provides our food; energy systems for electricity; hospitals, schools, and even the homes in which many of us live are now owned by asset management funds. If we look at communities, we’ve seen the rapid disappearance of social infrastructure and community assets, from shops to social clubs, and pubs to places of worship. Either ignored by commercial investment or dominated by gentrification, our cultural and retail spaces are either closed or been acquired. If we look at the public sector, more than a decade of financial austerity has massively underminded local and national government capacities to fulfill statutory obligations, let alone develop more proactive approaches to economic development. Worse, under-pressure councils have been selling publicly owned assets to balance the books at a rate of more than 4,000 a year.
This is nothing less than an ownership crisis. And it’s a crisis that can not be simply reversed by efforts to encourage business to be more responsible through corporate charity, ESG, or other voluntary schemes. Recent geopolitical upheavals – such as the Russia-Ukraine war – have shown that emboldened investors are now turning their back on even these small concessions.
So, what’s the positive news? Despite these negative trends and setbacks, there have been some positive and hopeful developments. We know there is low public confidence in private models of ownership, particularly in sectors like housing, energy, social care, and transportation.
The question and value of ownership has recaptured the interest of government, think tanks, and those in the voluntary sector, and it's been recognised as an important indicator in economic and social outcomes. We know that democratic ownership models can move us beyond short-term crisis fighting and allow us to address the underlying trends that are producing routine disruptions to the economy.
If we look at business, we’ve started to see a reverse of the generation-long decline in democratic business ownership, with the growth of co-op, community, and employee ownership. If we look at local government, we’ve seen UK councils use their programmes, services, and assets to directly tackle the roots of inequality, particularly through asset transfer, procurement, and specialist business support. If we look at the public sector, there are now more persuasive policies promoting democratic public ownership, which insists on a more decentralised relationship between the government and local communities. While we are still in an ownership crisis, these represent a promising – if fragmented – alternative to our broken economy.
So, what might we do? We are at a critical juncture. There are major challenges facing our society that will require a transformation of the ownership of our businesses, and our physical and social infrastructure. Particularly in areas, such as green energy generation, social care, food, and affordable housing. If democratic business models are going to be a meaningful part of this transition, we need to work together more effectively on research that can create the evidence to persuade influential stakeholders; policies that incentivise these types of ownership models; capital access that can be flexible and patient; and business support that is diverse and widely accessible. This is obviously happening in some places, but I’m sure it’s a constant frustration for everyone in this room that we’re failing to make the most of our collective political and economic power.
Essentially, we need to answer the question – why ‘democratic business’? And hopefully today’s summit will capture and refine the many answers to this question, and also more specifically outline how we can work together. If we want to fundamentally change the economy, we need to involve business, and changing the nature of business is crucial to this process. It needs to focus on power, control, and ownership – and that means democracy. I’m really looking forward to the panel and the workshops across the day which will look at how democratic ownership can reduce racial and gender wealth gaps, provide security for the most vulnerable members of our communities, and create the foundation for us to take on challenges outside of business, too.
For more information on the Democratic Business Summit see here.
